There is no industry that isn’t getting disrupted by technology: Shantanu Narayen/Adobe Systems

Shantanu Narayen, CEO of Adobe Systems

Shantanu Narayen, CEO of Adobe Systems, says that the Indian IT industry is entering a phase of enterprise software where companies must have the stomach to embrace change. He feels that the current digital push by the government has ensured tremendous opportunities for all the players and it is only a matter of picking the right bets. Edited excerpts of an interview:

Q: Your new office in Noida is an indication of your confidence in India as well as your growth plans for India. So, we have always talked about how bullish you are about the India story and how strategic a role India plays in Adobe’s growth plans. But from where you sit today, what does India look like?

You are right. Whenever I come here, we actually wear two hats. The first one is India as a market in itself and how that is growing and we can talk about Digital India and all of the opportunities that is going to afford.

And second is the role that the Adobe India centre plays in our global aspirations. We have been growing really well as a company and India has always had a disproportionate part of that growth. So yes, we continue to be excited. We are always ranked one of the best places to work here and employees are doing some amazing stuff.

Q:Your results are out on 28 September, so you cannot give us any forward-looking statements or talk about numbers, but I can talk to you about the kind of growth that we have seen for Adobe in your previous quarter and once again record revenues that you have announced in Q2 and lastly on the back of the kind of growth that you have seen as far as your cloud businesses are concerned. On the back of that,how do you manage expectations at this point in time? People are expecting after nine quarters that you are going to be able to deliver on this kind of growth. I do not want to talk to you about numbers, but how do you manage expectations and what is the dilemma and the challenge of being able to do that?

We look at opportunity and at the end of the day, if we can demonstrate, especially to financial investors, how large the opportunity is and if you can demonstrate a cadence for execution, then you think expectations will take care of it.

So, I like to focus a lot more on the opportunities, both the opportunities we have talked about, namely the entire creative economy and how design is becoming more important and aesthetics and how the creative cloud is clearly pioneered, how you can transform an existing desktop business into a cloud subscription-based business.

The second is the marketing cloud and everything to do with digital disruption. There is not an industry in the world that is not getting disrupted by technology; we are enabling them to use technology to do that. And so, two massive opportunities and as long as we continue to execute, the financial expectation takes care of itself.

Q: Let me talk to you about dealing with government and specifically in India, the Prime Minister has this big Digital India vision and you have of course met him in the Valley. In India as well, a lot of people are betting on that opportunity. We were talking to Linkedin. They have launched three products specifically for India, developed in India, made for and made by India. How are you seeing this play out? It has been about two-and-a-half years since the Digital India vision in that sense was unveiled.

There are a couple of things that make India a really unique opportunity as they relate to Digital India. The first is mobile.

India has the opportunity to leapfrog generations of technology and in this mobile-first or, in many cases, mobile only environment, any company like Adobe or others in the Valley who use India as an opportunity to innovate around mobile first, it is going to pay off not just in India as an opportunity, but also everywhere else, in all of the other markets. So, that is one big opportunity.

However, when you look at what has happened here with the Aadhaar card and everything to do with how people are moving inefficient paper based processes to digital, the Adobe Sign product has a very unique opportunity.

Think about identity on the web and how if you can digitally complete a transaction. So, Adobe Sign and what the government is doing with respect to what is happening on Aadhaar or companies like e-mudhra are actually able to now do digital transactions, I think that is just a massive opportunity. And last but not least the cost of transactions in India, whether it is financial services or automotive, are much lower.

And so, targeting how you can look at efficiencies in your business and then translate that across the world, we are actually continuing to see growth. When you see companies like Interglobe Aviation (Indigo), they are among the most successful in the world, or what is happening with companies that in some cases are emulating Us-based business models in travel or automotive or transportation, just a big opportunity for us in India.

Q:I will get to the enterprise opportunity in just a second, but let me continue to talk to you about the government opportunity. One of the concerns specifically that we saw in at least as far as the domestic technology companies when dealing with government was that revenues are inconsistent. They are patchy and lumpy. I know you do not like any of those words. So, what is your India team telling you in terms of being able to transact and deal with government? Has it got significantly better and easier?

We look at it as a little bit of a do you have the right bowling pins and if you have the bowling pins strategy—maybe we are a little bit more fortunate than local companies in that given the magnitude of our business, we can take a much longer-range approach to some of these businesses.

And for us, maybe the only metric is not revenue. In other words, if we can find that we are actually serving customers well and you are getting government agencies to adopt these technologies, you believe that as the number of transactions increase, the revenue will follow. In the commercial space for example, a similar opportunity might be in video whereas the amount of video that is being consumed, and the Olympics were certainly an example of that, is happening more on digital.

If you price your model where you are getting revenue as digital streams increase, it will take care of itself. So, our approach at Adobe has always been let us go find some key customers in government who have this vision of digital transformation and as long as you get them signed up and you build a great product and the business model allows you to grow as the business grows, that is a luxury that we have over the smaller companies.